A Collaboration with University of Pittsburgh   

Tyco settles securities fraud lawsuit with New Jersey for $73 million

[JURIST] Tyco International [corporate website] Wednesday reached an agreement with the state of New Jersey to settle a lawsuit [case materials] alleging that insider trading at the company cost the state $100 million in state employee pension funds. Under the settlement terms, Tyco will pay $73 million to New Jersey and claims will be dropped against Tyco chief legal officer Mark Belnick and directors Richard Bodman, John Fort III, James Pasman Jr. and Wendy Lane. Claims against former Tyco CEO L. Dennis Kozlowski and former Chief Financial Officer Mark Swartz, both convicted in 2005 of grand larceny and sentenced [JURIST reports] to eight to 25 years, still remain.

Tyco suffered one of the most infamous corporate fraud scandals [JURIST news archive] in modern times when Kozlowski and Swartz were found guilty of looting the company and defrauding its shareholders out of more than $150 million in unauthorized personal compensation. Tyco settled SEC charges [JURIST report] of fraudulent accounting in April 2006 for $50 million. In July 2007, a federal judge gave preliminary approval [JURIST report] to a $3.2 billion settlement agreement [JURIST report] between Tyco, the company's former auditor PricewaterhouseCoopers [corporate website], and investors who were harmed by fraudulent accounting practices orchestrated by Tyco's former top executives. The New Jersey Law Journal has more.


 JURIST is nominated for a 2008 Webby Award as best Law website... Please vote for us here!

Support JURIST

We rely on our readers to keep JURIST running

 Donate now!

About Paper Chase

Paper Chase is JURIST's real-time legal news service, powered by a team of 30 law student reporters and editors led by law professor Bernard Hibbitts at the University of Pittsburgh School of Law. As an educational service, Paper Chase is dedicated to presenting important legal news and materials rapidly, objectively and intelligibly in an accessible format.

© Copyright JURIST Legal News and Research Services, Inc., 2013.